China trainmaker CRRC to build more plants abroad in expansion plan: China Daily
SHANGHAI (Reuters) - Chinese trainmaker CRRC (601766.SS: Quote)(1766.HK: Quote) plans to build more factories abroad as part of its plan to double sales outside of China to up to $15 billion by 2020, state-run China Daily reported on Monday.
CRRC expects a total of $8 billion worth of orders from overseas customers this year, and was also open to teaming up with competitors to win bids in some markets, company executives were quoted by the newspaper as saying.
Since it was formed in 2015 by the merger of China's top two trainmakers, CRRC has been aggressively chasing overseas orders and deals. It agreed in September to join forces with Canada's Bombardier (BBDb.TO: Quote) on overseas bids, and would target projects such as New York's subway system, the newspaper said.
The firm, however, said global demand was weakening as slower economic growth dragged on infrastructure spending.
"The world's rail-transport market is not as hot as in past years, just like the global economy. Infrastructure construction needs money. The general demand is falling," Zhao Mingde, CRRC's director of strategy and planning, was quoted as saying.
"Many foreign governments also ask us to build plants in their countries as part of the deal to continue the business," he added.
Overseas orders accounted for about 7 percent of CRRC's 2015 sales. The company wants to boost this to 35 percent by 2025, the newspaper reported.
It has factories in South Africa, Malaysia, Turkey and Iran, and opened a joint venture plant in India in August. Last month, CRRC also said it was in talks to buy Czech trainmaker Skoda Transportation, a deal which brokerage Guotai Junan puts at 3.8 billion yuan ($550 million). Continued...